WorldRemit raises $175M to expand in growing remittance market
Cross-border money transfer provider WorldRemit has secured $175 million in new capital in a Series D funding round to challenge legacy money transmitters in the fast growing cross-border payments market.
WorldRemit reported that it plans to use the new investment to further drive its global growth and diversify its product offering for both money transfer senders and recipients. WorldRemit will also launch a new money transfer solution for small and medium-sized business owners who trade internationally, especially in emerging markets, pending regulatory approval.
The funding round included three venture capital firms: Accel, LeapFrog Investments and TCV. Accel, based in Palo Alto, Calif., had previously led the Series A and B funding rounds for WorldRemit while Leapfrog Investments led the Series C round.
According to Crunchbase, a website that tracks investments in private startups, WorldRemit has raised more than $400 million in debt and equity funding over 11 rounds since 2011.
Founded in 2010 and based in London with growing global presence, WorldRemit has been challenging the traditional cross-border remittance companies such as Western Union and MoneyGram. WorldRemit, like many other challenger remittance firms such as Remitly, have focused on the growing consumer demand to leverage smartphone and online payments to send money overseas.
WorldRemit serves almost 4 million customers that are transferring money from 50 origination countries to consumers in 150 countries, according to its press release. The U.S. is WorldRemit’s largest sending market.
Western Union has furthered its new strategy to combat the remittance fintechs with a pact with Amazon and by building a digital component to its service. Meanwhile, MoneyGram has decided to forge an alliance with Alipay, despite its failed merger last year with Ant Financial, Alipay’s parent company, in a deal which was heavily opposed by the Trump Administration.
The market for cross-border remittance is expected to grow by an additional $26 billion in 2019, representing almost a 4% increase over 2018 volume. Based on data released from the World Bank, remittance payment volume grew a staggering 8.8% in 2018 over 2017’s volume, representing a $56 billion increase in money sent across borders.